Staff Reporter
The growth in healthcare costs in recent years has become an issue of concern to the domestic medical aid funding industry.
This is despite the fact some may argue the value of assets Namibian medical aid funds hold in reserve, approximately N$1.7 billion as at 30 September 2022, is adequate to withstand any adverse claims experience which may result from increased liabilities.
According to the Namibian Association of Medical Aid Funds (Namaf), funds are facing challenges as they have been spending more money on claims in comparison to the contributions collected over the last six months.
“The ideal ratio for funds is 85% and should be spent on healthcare costs/claims, 10% on administration
expenses, and 5% towards reserves/investments.
The current experience is that all medical aid funds are constantly accessing their reserves to fund
healthcare benefits which are not sustainable in the medium to long-term,” stated Uatavi Mbai, spokesperson at Namaf.
Mbai noted that the medical aid funding industry lessens the burden on strained national healthcare by providing members access to state-of-the-art healthcare and allowing healthcare providers to practice their professions or offer their services.
“With the increase in the numbers of specialist and private hospitals in Namibia, the healthcare landscape has changed, and understanding our role in slowing the growth in claims experience involves understanding what drives healthcare costs and how to manage those drivers effectively.
This includes understanding the relative importance of healthcare cost drivers, which amongst others,
include benefit design, price inflation, provider incentives, consumer-induced demands, technological growth, etc,” Mbai stated.
Meanwhile, to ensure the industry’s funding sustainability, Namaf believes every key stakeholder should
understand their role and how they can positively contribute.
“The question that each key player should be asking themselves is, how
can they assist in ensuring the sustainability of the health funding industry,” Mbai said.
Moreover, Namaf is in the process of implementing strategies to ensure the future sustainability of the medical aid funding industry in the interest of all stakeholders – medical aid funds, healthcare service providers, and, most importantly, members of medical aid funds.
“All Namaf registered medical aid funds have committed to work together toward finding and implementing solutions through devising industry-level interventions by entering into an agreement.
Workshops are being planned for June 2023, during which the funds and the management committee will set out strategies toward ensuring the future sustainability of the industry,” Mbai concluded.